Monday, March 24, 2014

What Cities Can Learn From Convenience Stores

The differentiator that separates top-performing convenience stores (double the share of wallet) from others is cleanliness. However, Boston Consulting Group has found that this means more than being spotless.

Perception of cleanliness among convenience store customers also includes being pleasant smelling, stain free with up to date infrastructure such as fixtures, displays and equipment.

Elements of upkeep such as this are also proven to be one of the key differentiators for cities and states seeking a distinct and unique sense of place.

Differentiators are key to stimulating and sustaining resident pride as well as being appealing to talented newcomers.  It isn’t the one “big thing” such as mega-projects, a 20th century notion, that differentiate communities.  In fact, studies show these facilities more often blur distinctiveness. 

Differentiation for communities and states also begins with clean and well-maintained streets and roadsides, abundant green infrastructure, open space and freedom from blight including sign blight. Distinctive architecture and place-based culture are also differentiators, but these are invisible without good curb appeal.

Differentiation is pivotal for economic growth, whether it be the ability to generate both supply-side economic development (relocating or expanding businesses in search of talent) and in its purest form, demand-side economic development (visitors.)

The irony is that communities so often get immersed in big projects, when what makes them appealing is their attention to the little things.  Urban Land Institute land use analyst Ed McMahon calls this the “economics of uniqueness.”

As compared to the last century model of economic development when communities focused on “what they didn’t have,” the focus today for communities that are successfully differentiating is “on what they do have,” things that make them distinct vs. the same.

It is about attachment to place.  The three-year study by the Knight Foundation, about which I have blogged, concluded that “communities with the highest level of attachment to place also have the strongest economies.

McMahon notes that communities can learn a lot from golf courses.  Residents pay 25% to 50% more for homes here than in comparable non-golf course developments, but 80% do not golf.  They like the open space, the tree groves and other elements of green infrastructure.

Maintaining golf courses is expensive but savvy developers understand now that this premium value can be generated  more cost-effectively when it includes significant green space including trails.

It is the same value-added that is leading some developers now to embed a working farm in the midst of an urban, village development, a movement deemed “agrihoods” or as the New York Times labeled them last week, “farm-to-table living.”

One such development that is particularly intriguing is Serenbe, a 40,000 acre hamlet in the Chattahoochee Hill Country of Georgia, a little more than 30 miles south and a little west of and an alter-ego to Atlanta which has long ago surrendered its soul for entertainment.

This hilly area is one of the very last remaining rural areas within thirty miles of Atlanta’s Hartsfield-Jackson International Airport.

The Chattahoochee Hills are about 120 miles west of the Oconee National Forest.  Along the northeast side of this is 58 acres, including 44 acres of magnificent hardwoods still held in its natural state, owned by a friend of mine in North Carolina for nearly 40 years.

Many of these magnificent trees date to 1890 when Atlanta’s population was 65,000, slightly larger than the town of Chapel Hill, NC, a few miles south of where I live is now, a town fighting to regain its sense of place.

Another friend in North Carolina helped his wife set aside 70-acres of mature hardwood forest on her ancestral farm into a protected wildlife sanctuary that permits research and education but perpetually prohibits hunting and timbering in a conservation easement.

Conservation easements have also played a role in the 65,000 acre Chattahoochee Hills Country, preserving the character of the land while shaping inevitable development to protect sense of place.

The hamlet or series of hamlets including Serenbe are part of a 40,000 acre area of forested hills (about the size of the Napa Valley wine country of California) along the Chatahoochi River with a zoning overlay that calls for preservation of 70% of the acreage.

Serenbe, which also incorporates a nearly 25 acre working farm, will still accommodate as many or more people than traditional subdivision-style developments, which usually disturb 80% of their land area.  The food produced by the farm, which is certified organic, is distributed to residents and local restaurants in a forty mile radius.

But Serenbe is about preserving a lifestyle and much more than that related to nature.  Developers have known for some time that a good way to differentiate and draw higher values anywhere from homeowners as well as commercial tenants is to incorporate significant green space.

This they have found far more lucrative than what whiners do who try to make money instead by what economists call “rent-seeking,” a form of money-making by manipulating government decisions to undermine natural and historic preservation and sense of place.

Communities such as Durham, North Carolina, where I live, owe their reputations to community marketing that leverages their sense of place as a differentiator.

They haven’t lost their soul but they are at a crossroads, with one foot in the last century model of the “next big thing” while failing to fund true differentiators such as upkeep, preserving through adaptive use on one hand, while sowing the seeds of destruction for organic areas.

Here, we haven’t quite come to terms with the fact that in this century, economic development and differentiation isn’t about “what you don’t have” but accentuating “what you do have.”

The clock is ticking.  As McMahon often says, “Do you want new development to shape the character of your community?


Do you want the character of your community to shape new development?

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